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Tuesday, July 6, 2010
Forex Special You have been reading dozens of e-books, bought useful and useless courses online. Possibly attended Forex seminars which cost a leg, bought CDs and been searching the web for the ultimate trading system for huge profits. Hopefully months into your learning curve and a dozen wiped out demo accounts later you decide its time, it is time to do it for the first time. Let me trade on a live account!
After you have selected a decent broker (look for posts in the future to help you select a broker because this is a very important point in your trading) and have your credit card in hand, you feel empowered and nearly some Greek god or like a samurai with his sword. As you digit the keys to load your brand new live trading account the adrenaline is already into your head. You feel nervous, anxiety at its limits and your account is now loaded.
Starting to scan the market, open the charts in the look for that perfect setup to increase your account today and trade like a pro. You have not seen a decent setup which matches your trading plan entry rules and does not follow the trade management rules you have written in your trading plan. Possibly you are too nervous and you just rush into a trade as you want to be in it and you are feeling you are loosing money not being in a trade right now. You hit the button and enter a trade.
The market starts the usual noise if you traded in the main session hours (Asia, UK or US). You feel as if your heart is going out of your shirt and you have been sweating like a horse with your eyes bulging into the monitor to see your position, if you should exit your trade. Red to Green, Green to Red the market swings and you pray for the ultimate profit. Suddenly something happens which you do not know about and you have not researched enough for it and the market in 1 minute, yes just 1 minute rushes in the direction of your stop loss (hope you had a stop loss) and in no time it’s all over. Gone. The trade has been stopped out and you need to load your live trading account again.
This scenario might look like some fiction or an extract from a novel but this scenario is very true and regularly happening in the markets. Especially with novice traders and Forex market beginners.
In the next weeks I would like to share with you some trade management skills and principles that would help you feel more comfortable in front of the trading screen, the impulse to hit the exit will be controlled and you will start trading more profitably.